By how much will the production cost increase

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Q1. Assume that production will increase to 32,000 jars of salsa during June. By how much will the production cost increase compared to the May budget?

Santiago's Salsa

Production Costs

June 2020

Production - Jars of salsa 32,000

Ingredient cost (variable) $25,600

Labor cost (variable) 15,360

Rent (fixed) 5,000

Depreciation (fixed) 6,000

Other (fixed) 1,000

Total $52,960

Increase in cost $2,560

Q2. How does the cost per unit differ for May and June? What caused the cost per unit to decline?

Unit cost in May $1.68

Unit cost in June $1.66

Reference no: EM133146265

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